Once again, the neediest take the hit

Worcester's deteriorating neighborhoods, bludgeoned by a housing scandal that unleashed waves of foreclosures and abandoned by House congressional politicians who opposed federal housing funding, just absorbed another punch to the gut, this time from City Hall.

According to an audit by the federal Office of the Inspector General, the city has mismanaged, misused, and in some instances, one could say, plundered federal Community Development Block Grant funds meant to help rebuild distressed communities through an anti-poverty program.

A careful reading of the audit suggests the city and many of the players involved in implementing and overseeing the program treated it as a cash cow, using it to subsidize ineligible and non-supported expenditures, including, at times, bloated overhead costs.

The audit pointed out, for example, the city contracted with the Worcester Housing Resources agency to make loans to individuals trying to rehabilitate their properties. In one instance, the agency charged the CDBG program $6,652 in administrative fees to process a $579 loan.

The feds also questioned $1 million of the program funds the city spent on Department of Inspectional Services employee salaries and fringe benefits.

Overall, the feds are asking the city to repay some $2.1 million in CDBG program funds spent on ineligible activities, and another $298,303 spent over the program's spending cap. The city is also being asked to provide documentation to support more than $3.9 million in additional expenditures within the program.

There appears to be a bit of finger-pointing as to who is to be blamed: the city administration or the community development corporations.

Meanwhile, the city manager, in a memo to city councilors, said the audit targeted "past practices" and is not a review of current practices.

"We will use these findings, together with our own ongoing analysis, review and restructuring efforts, to continue to build a strong program that supports Worcester's neediest individuals well into the future," he said.

That is all well and good. But where is the accountability? Who is asking why this lack of "effective management controls," and inadequate "monitoring and oversight" by the city was allowed to last for as long as it did?

Who is reviewing the appointments of housing and neighborhood development officials to ensure they have the proper qualifications and training?

And how do we know this mismanagement is a thing of the past?

The city suggests that if it cannot recoup the more than $2 million it is required to repay the feds from the local CDCs, it will make the repayment from future CDBG grant funds.

If the latter becomes the reality, then the city's distressed neighborhoods and social service agencies, such as Friendly House, will face even greater calamity, given that a House appropriation subcommittee recently passed a fiscal 2014 bill that cuts CDBG spending by 50 percent.

City Councilor Joe O'Brien, who over the past couple of years questioned the city's use of CDBG funds to subsidize what has traditionally been municipal operations, is confident the city administration is working to address the concerns raised in the audit.

But Mr. O'Brien also believes the City Council should review the CDBG program and establish "priorities and the approach the city should be taking going forward."

"There are serious liabilities to losing (CDBG) funds, which will impact everyone who benefits from the program," he said. "There is a lot at risk."

That is why we need a lot more accountability than just the manager's word that "everything is all right now."